Political Activism and Lobbying for California Nonprofits

Most Nonprofits Don't Realize They May Engage Politically--With Restrictions

Can your 501(c)(3) or 501(c)(4) engage in political activism or lobbying? Is your central mission so campaign-oriented that you should you form a 527? This page provides helpful resources for nonprofit founders wondering about the laws restricting nonprofit activism.

A myriad of rules govern nonprofit lobbying, organizing, and spending, and the rules are applied differently to each nonprofit type.

Types of Political Activities

What types of political activity should you consult your attorney about before commencing? In short: any political activity to make sure you don’t run afoul of federal law and IRS rules. The IRS looks at political activity in three broad categories. The category a nonprofit organization’s political activity falls under determines how much activity it may conduct (if any):

Supporting or Opposing Candidates

Political activities that support or oppose candidates for office, or “political campaign intervention,” includes, among other things:

Directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office

Contributing to political campaign funds

Making public statements on behalf of an organization in favor of or in opposition to any candidate for public office

Voter education or registration activities with evidence of bias that favors one candidate, opposes a candidate in some manner, or has the effect of favoring a candidate or group of candidates

Lobbying or Advocating for a Change in Law (Federal, State, or Local)

Legislative activities, more commonly known as lobbying, includes attempts to influence legislation and advocate in ballot measure campaigns.

Under IRS rules, an organization attempts to influence legislation if it: 1) contacts, or urges the public to contact, members or employees of a legislative body for the purpose of proposing, supporting, or opposing legislation, or 2) advocates the adoption or rejection of legislation.

Voter Education and Nonpartisan Activities

Some political activity has few restrictions if conducted in a nonpartisan manner. One such activity is pure voter education, such as organizing public forums or publishing voter education guides about issues or candidates in an evenhanded, nonpartisan manner. Additionally, activities intended to encourage people to participate in the electoral process, such as voter registration and get-out-the-vote drives, are not be prohibited political campaign activity if conducted in an evenhanded, nonpartisan manner.

Nonprofit organizations should always review their voter education and nonpartisan political activities with counsel to ensure they don’t inadvertently: 1) support or oppose a candidate or 2) spend an amount beyond a permissible amount for lobbying.

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Federal law groups political activity in three categories.

Can Nonprofits Be Politically Involved?

Contrary to popular belief, all nonprofits may be involved in the political process, but how politically involved varies by tax status, the type of political activity, and the amount spent on political activity.

For example, a 501(c)(3) is prohibited from supporting or opposing candidates, whether financially (by making campaign contributions) or verbally (by making verbal or written statements for or against any candidate). Meanwhile, a 501(c)(4) may support or oppose candidates, as long as those activities do not constitute the nonprofit’s primary activity. A 527 organization may spend an unlimited amount on supporting or endorsing candidates, but is subject to a host of disclosure requirements about its donors and expenditures.

What to Do Before You Lobby

The rules are similarly complex and confusing for lobbying and ballot measures, and the penalties for noncompliance are strict, often including revocation of tax-exempt status, stressful audits, and taxation of funds raised — not to mention loss of faith among donors.

If you run a nonprofit and intend to become politically involved to any extent, you should retain counsel that can provide your organization training on what it can and cannot do in the political space–and provide ongoing logistical and legal advice as your nonprofit grows and expands.

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Influencing Politics Isn’t Your Primary Mission, But You May Want to be Politically Active

As a nonprofit founder, you have more latitude to be politically active than you might think — but every nonprofit type would benefit from legal counsel in order to stay within the strict and sometimes confusing regulations for engaging politically. Depending on your tax status, the type of political activity, and the amount spent on political activity, you may have a number of options to engage politically already.

Even if the type of activity you want to conduct is outside the bounds of what you can achieve with your current tax status, you may have other options. For example, it might make sense to establish a separate, affiliated organization with a different tax status that would allow you to achieve your political goals.

Tuple can help your organization chart the right course of action for achieving its political goals.

What if Influencing Candidate Elections is my Organization’s Primary Goal?

If influencing elections and politicians is your nonprofit’s central mission, forming a 527 nonprofit organization may be the most logical tax status — but you should absolutely consult with an attorney about your planned activities before making that determination, as 527s are subject to many rules and regulations that don’t apply to other nonprofit types.

A 527 organization may raise and spend unlimited funds for its activities supporting or opposing candidates (subject to a host of campaign finance laws). But the IRS restricts how much 527 organizations may spend on lobbying activities. 527s must also abide by complicated reporting and disclosure requirements.

Compliance is especially crucial for 527s because your opponents — the stakeholders on the other side of an election — will likely scrutinize your disclosures.

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Nonprofit organizations may be involved politically–subject to a host of rules.